The mining company Rio Tinto, which is the world's second largest producer of iron ore after Vale, announced an increase in profits by more than 2 times. Besides, company announced a reduction of debt by nearly $ 2 billion due to lower spending on new projects, which was caused by the fall in prices for iron ore and coal.
Net profit totaled 4.4 billion USD for the first 6 months of 2014, against 1.72 billion USD over the same period of the last year. The size of the interim dividend was increased to 96 cents per share, in line with analysts' forecasts.
At the moment, the company quotes are under pressure of weakness of the iron ore market, and the growth potential is minimal, but in case of improved price conjuncture, the company can increase its sales due to new capacities. We recommend keeping the company's shares in the long-term portfolio, but part of them should not exceed 4-5% of the investment portfolio.